Thanks to its efficiency, accuracy, and innovation, software's commercial value is undisputed. Software systems are utilized to support various business processes within organizations, and the extensive use of such systems often requires significant investments and expenses. The amount of money invested in software continues to rise, and this is partly due to the belief that adopting technology provides a competitive edge that allows companies to outperform their rivals. Legal protection of software refers to measures available to prevent unauthorized use, modification, distribution, and access to software. These measures are designed to protect the intellectual property rights of the inventors of software and prevent copyright infringement. The most efficient way to ensure legal protection of software is to take preventive action before it even comes to a dispute, by appointing an expert – an intellectual property and software legal protection lawyer.
Primarily, software legal protection in Serbia falls under the Law on Copyright and Related Rights. Under this Law, computer programs, i.e. software, alongside all technical and user documents related to the computer programs, in any form of expression, are considered written works and are protected by copyright.
Copyrights
A work of authorship is an author’s original intellectual creation, expressed in a certain form. The following works are deemed as works of authorship: written works; spoken works; dramatic, dramatic-¬musical, choreographic, and pantomime works, as well as works originating from folklore; works of music, films; fine art works; works of architecture, applied art, and industrial design; cartographic works; drawings, sketches, dummies, and photographs; the direction of a theatre play. Therefore, original and objective codes are considered “written” works, which fall under the legal protection of copyrights. Law on Copyrights and Related rights specifically as a copyright includes computer programs with all of the related technical and user documents, in whatever form they are expressed, including the material used in the preparation of its production. All of the aforementioned intellectual creations, including software, are subject to the legal protection of copyrights, which topic is scrutinized in our recent blog.
The infringement of the copyright is the unauthorized performance of any act encompassed by the exclusive rights of the holder of copyright, such as for example the exploitation involving the use of copies of such subject-matter of protection that were made without authorization. If the author's work is a computer program, then putting the program into operation on a computer is considered duplication. In 2020, the Supreme Court of Cassation of Serbia expressed the opinion that the method of duplicating the work is also the use of the "remote desktop connection" application, which enables remote access to the software on many other computers within the defendant's organizational unit, whereby the defendant used one software on 990 connected computers. In this case, the defendant's license granted the right to use the software to the extent allowed by the installed single-user hardware protection, i.e. one software one computer principle. The license did not include permission to use the software on a one-software-many-computer basis. Also, the defendant violated the interest for the economic exploitation of the software, taking into account the number of remote accesses to the software.
It is important to emphasize that the license obtained for one version of the protected software cannot be used for another version of the software. Just because there are newer versions of the software does not mean that the older versions can be used for free. This is considered an economic offense according to the Law on Copyright and Related Rights.
Software created as an employee
Nowadays, many authors create their work in the course of an employment, therefore it is essential for them to understand their author’s right in Serbia. If an author has been created software as an employee in the performance of his/her duties, the permanent holder of all exclusive pecuniary rights on such work shall be the employer, unless otherwise provided for in the contract. Author’s remuneration is certainly the right of the author. It is important to emphasize that it is not enough for the software to have been created during the duration of the employment, but it is necessary that it was created in the performance of work obligations.
Contract on commissioning a software
Another successful way to protect copyright is by Contract on commissioning a software. Under a contract on commissioning a software, the author undertakes to produce a work of authorship and to hand it over to for the commissioning party. If a software was produced on this basis, the commissioning party shall acquire all rights to the exploitation of that computer program, unless otherwise provided by the contract. The party commissioning a software shall have the right to direct and control the production of that work, though without substantially restricting the author’s freedom of artistic, technical or scientific expression by doing so. In the case of licensing of pecuniary right, but software has not been created yet, it is necessary to determine the kind of the future work and ways of exploiting it. Any licensing of pecuniary rights on all future works of an author, as well as on still unknown forms of exploiting a work, is not legally allowed.
Engagement Agreement
Often, an owner of the software enters into an engagement agreement with an external contractor for the purpose of software maintenance. In this case, the Agreement should consist of provisions defining the intellectual property rights of the software in question, between the software developer and the company (orderer) while in the process of developing the software and its maintenance.
Software License Agreement
Software License Agreement is a type of agreement that allows a holder of an intellectual property right to transfer a right to use (i.e. subscription) in exchange for a license fee. Software License Agreement also defines intellectual property rights between the owner and the user of the software. It is very rare that these agreements define the transfer of intellectual property rights of the software. Most often, they will just define the software transfer terms. Even though it is rare, the intellectual property rights of the software should be defined in Software License Agreements. A detailed and precise software license agreement can make a huge difference in the field of using tax incentives in Serbia, mainly the tax incentives of IP Box, and in the field of avoidance of double taxation, in cases where a right to use a software authorizes clients in different countries, and in most cases, multiple countries.
Drafting these Agreements and other commercial agreements , outside the field of IT, presents a working field of corporate lawyers.
Software protection under copyright law in Serbia
Do you have to register a copyright?
According to Law on Copyrights and related rights in Serbia, only the form is protected - specific words from a book or lines of code. Therefore, copying someone else's book and putting your name in place of the author is forbidden. However, adopting ideas from the book will not constitute copyright infringement. By analogy, taking a software idea and writing the code yourself, without rewriting someone else’s code, will not constitute copyright infringement.
Do you have to register a copyright?
It is not necessary to register the software to have copyright protection. However, for easier proof of ownership of the source code, there is a possibility of depositing a copy of the software at the Intellectual Property Office. This does not affect the start of the duration of the copyright protection and is not mandatory, but the deposit can serve as material evidence of facts that may be relevant to a possible court dispute or for a tax incentive application, which relates to the reduction of corporate income tax on income from granting the right to use (licensing) a work of authorship, which includes software. When submitting an application to deposit a software, the copy of software in material form is submitted, often on a USB. Depositing copyright allows the applicant to obtain a confirmation from the Intellectual Property Office that the source code was registered on a particular date. In the event that a third party uses your software without your consent and permission, you have a document issued by the Intellectual Property Office that the software was deposited on a particular date. When you file a lawsuit against someone for unauthorized use of your software, the party who has committed this act has the burden of proving that the software they used does not belong to you. This is because the Law on Copyright and Related Rights stipulates that data in the Intellectual Property Office records is considered true until proven otherwise. Additionally, if the original source code is registered and a competitor or a third party uses the same code for their product, the deposited code which was deposited at an earlier date compared to the code creation date of the party who has committed the act of infringement will serve as strong and irrefutable evidence in the court.
The procedure before the Intellectual Property Office is quick and takes no more than 30 days from the day of submission. When the procedure has concluded, a certificate is issued to the author, which has the force of an official government document, which states the title of the protected copyright, a form of copyright, and the type of deposit, as well as information about the author and copyright holder. In the case of depositing software at the Intellectual Property Office, a description of the software must be provided. The description should contain the basic characteristics of the software and must be signed by the author. It is also necessary to provide a legal basis for the deposit application, such as a statement from the company's CEO that the employee created the copyrighted work in the term of employment or a contract on commissioning of software.
Copyright protection fee
For this process of depositing a software with the Intellectual Property Office, the author submitting his software needs to pay an administrative fee in the amount of 4,105.00 RSD, if the initiator is an individual, or 8,210.00 RSD, in case the initiator is a company. Authors’ pecuniary rights last while the author is alive and 70 years after the author’s passing, while the author’s moral rights last even after the term of the author’s pecuniary rights has passed.
Software legal protection - Patent
In European continental law, usually the software is protected by copyright law mechanisms of legal protection, as explained above. However, in rare cases, software controls certain hardware and leads to industrial use of the hardware. In these cases, patent, as a legal protection of software, comes into discussion, according to variety of the opinions of the European Patent Office. Therefore, for the software to enjoy patent protection, it needs to have a certain degree of technical use, notwithstanding the usual relation between hardware and software.
When is a patent created?
A patent is one of the categories of intellectual property law. Patent protection begins upon registering an invention. Therefore, unlike copyright law which entails legal protection of the copyrighted work upon its creation, physical typing of a code, or software, patent protection does not begin upon the creation of the invention, but upon its registration in the Intellectual Property Office.
Is patent registration mandatory?
In order for an invention to enjoy patent protection, it needs to be registered in the Intellectual Property Office. International patent protection is thoroughly described in our blog post.
Know-how
Know-how is technical or practical knowledge that is used in the application of an invention or a work and production process. Know-how is protected in a more informal way because it does not register. Often, patent applicants do not want to show their invention in detail because patent applications are published publicly by the Intellectual Property Office, but they keep the special knowledge related to the practical application of the invention a secret, such as know-how and usually protect it through a non-disclosure agreement (NDA) with employees, consultants, and others who have knowledge (know-how) about the software.
Trademark
A sign that represents the company's identity, and that reflects the quality and values of a specific brand in the eyes of the client, is protected by a trademark. Why is a trademark important when we talk about legal protection of software? Let's say you've developed a very successful food delivery app, and due to the workload and many business challenges, you haven't had time to think about protecting your trademark. Your logo is already quite well-known and instills confidence in users that the service they receive will be good and efficient. A new application appears that uses a logo almost identical to yours, and thereby misleads users, while "taking advantage" of the trust you have gained.
Let's take a look at the App Store. Every day, many applications try to "use" the power and recognition of a well-known brands, by using a very similar name or logo. In order for Apple to resolve such infringements of intellectual property rights, it is necessary to first have a registered trademark. You can read more about trademark protection on our blog.
Software legal protection Lawyer
There are many reasons why legal protection of computer software is important, such as protection against copyright infringements, increasing the value of software in the eyes of investors and buyers, protection of the author’s interests, etc. An increase of copyright infringements is becoming a common occurrence, so if you want to consider your options in order to ensure the best legal protection of software and therefore core value of your company, contact our law office via email at [email protected], through the contact form on our website, or via LinkedIn.
